The US fitness industry generated $33.25 billion in revenue in 2021, which is expected to grow 171.75% by 2028.

Over 39% of Americans pay for a health club membership, and 42% of these memberships are at smaller, boutique gyms. With so many people looking for ways to stay fit, you may be able to make some cash by starting your own gym business—with some careful planning, of course.

How much does it cost to build a commercial gym? What steps must be taken to achieve your dream of starting a gym business?

Planning out your financial investment is crucial to your success.

Keep reading for a guide on the average costs of opening a commercial gym, including property and facility costs, operational costs, purchasing gym equipment, and more.

Up-Front Costs of Opening a Commercial Gym

Whether you’re looking to open a CrossFit facility or a traditional training gym, building a fitness business will likely require a substantial chunk of up-front investment and capital.

Regardless of your chosen path, it’s useful to break down the expenses into two categories: up-front and recurring costs.

The initial costs of opening a gym can vary hugely depending on the type of gym you want to open, but they are typically between $10,000 and $50,000 on average.

However, the final cost may exceed this, too. With so many variables, it's almost impossible to give a completely accurate estimate that reflects all gyms.

Here are some one-time costs to factor into your budget.

Type of Gym

The first and most critical decision you must make is what type of gym you want to open.

What is the ultimate version of the gym you have in mind? There are many different types of gyms, including:

• Big box gyms
• Group fitness students
• CrossFit gyms
• Powerlifting gyms
• Personal training gyms
• Athletic development gyms
• Fitness boutiques
• Yoga studios

...and the list continues.

You'll also need to decide whether you will make your gym owner debut as an independent operator or purchase a gym franchise. While gym franchises are popular, there are benefits to striking out on your own, such as total control over your fitness facility and its reputation.

Do your homework before settling on a specific type of gym and business model.

If you're going to open a fitness business on your own, be sure to do your research first. Franchise gyms sometimes have hidden fees to consider. Review your business plans with someone you can trust. And if you decide to go solo, planning for success can be difficult without guidance from a mentor or someone who has been through it before.

Physical Location

Next, you'll need to choose a physical location for your new gym. How big of a space do you need? Do you want to purchase a building or rent a space?

Your facility's location and size will depend on several things, such as:

• Whether you are opening an independent gym or franchising
• Local competition
• Local demographics
• Whether you lease or buy the space
• How many separate spaces you need (Will you have a separate cardio area? Will you provide locker rooms?)

Here, the upfront costs are either your down payment or deposit. On a commercial real estate investment, that will be between 20-40% of the purchase price, depending on location.

To rent a 2,000-square-foot commercial space, expect to pay between $4,000 and $6,000 a month, so if you're depositing the first and last month's rent, your rental costs will be $8,000 to $12,000 up-front.

Build-Out Costs

It's likely that the space you rent won't have everything you want right away, whether it's amenities, aesthetic appeal, or both. So you may need to run a build-out of some kind before opening your doors.

You also need to consider the facilities your customers will expect and whether you can provide them immediately. For example, a bathroom is necessary, but do you have enough space for a full-blown locker room?

Depending on your wants, a commercial gym build-out can range from $50 to $200 per square foot.

Gym Equipment

Your choice of gym equipment is arguably the most critical decision you'll make as a new gym owner. Not only do you need gym equipment built to last in a commercial setting, but you must also be frugal, selective, and space-conscious.

Any respectable training gym will have a combination of the following types of equipment::

• Free weights
• Olympic barbells
• Bumper plates
• Squat stands and racks
• Pullup rigs
• Medicine balls
• Resistance bands
• Plyoboxes
• Adequate storage
• Gym flooring

To keep costs down, focus on your specific target market. If your target patrons are most interested in bodybuilding, you might be able to hold off on expensive cardio equipment and isolation weight machines.

Depending on the number of pieces of equipment required and your expected quality, fitness center equipment costs can range from $5,000 to $20,000.

While you want to budget appropriately, do not skimp on gym equipment. It's true—you get what you pay for.

Purchasing fitness equipment is a significant investment and long-term commitment, so be confident in your choices. Plus, your chosen equipment will be one of your first impressions on potential gym members.

If you're stuck, Again Faster can help you design your new facility for maximum functionality. Schedule a consultation with our experts to ensure your gym equipment wishlist makes sense with your space and plans to scale your member base. We also offer custom financing options for new gym builds.

Certifications

If you employ fitness trainers at your gym, you definitely want them to be certified—for members' safety and your credibility.

Accreditation for fitness professional training averages between $400 and $800, so budget accordingly if you plan to foot the bill. Associations offering some of the top personal training qualifications include:

• American College of Sports Medicine (ACSM)
• American Council on Exercise (ACE)
• International Sports Sciences Association (ISSA)
• National Academy of Sports Medicine (NASM)
• National Strength and Conditioning Association (NSCA)

The style and focus of each qualification should be a driving factor in which one you choose.

Legal Fees

You should also consider local and federal licensing requirements for your new gym venture. Depending on where you live, the costs and needs will vary. You can expect to have to provide the following legal documents and certifications:

• A business license
• A trade name registration
• An employer registration
• Health and safety certification

Many of the above processes, including getting certified as a business and obtaining the right business permits and licenses you need, will be much easier with legal help. To be safe, you should budget $5,000 to cover the cost of legal fees, permits, and licenses.

Gym Management Software

To manage the many aspects of your gym facility, you will need computer software to manage customer relationships, schedule classes, plan membership events, and more.

Look for gym management platforms that integrate with your chosen point-of-sale system so you can process payments (or sell merchandise at the door. You should expect to pay $500 to $2,500 for this technology.

Responsive Website

Every modern company needs a website. Web design and development costs will vary wildly— you can expect to pay anywhere from $200 to $10,000 for the initial build.

A website's total cost depends on its size, complexity, and whether or not you hire a professional. You can save hundreds, even thousands, of dollars by building your own website.

The good news is there isn't any longer a need for a degree in web development to create a simple website. There are several tools available online that allow you to create your own website and cut costs easily.

Operating Cash

You will need some working capital and cash reserve funds for normal business operations.

The standard rule of thumb is that businesses have a cash buffer of three to six months’ operating expenses. However, this amount can depend on many factors, such as the industry, the business's stage, goals, and funding access.

Having at least $1,000 on hand when you open is a good idea.

Recurring Costs of Opening a Commercial Gym

Now that we've covered the fundamental startup costs, let's touch on some monthly costs to consider when operating a commercial gym before opening up shop.

Various In-House Expenses

First, the mortgage and rent expenses will run about $2,000-$6,000 a month or more.

Utilities are often the most significant expense for gyms, especially those open 24/7. You need to keep power and heat going, and water is required for hydration and cleaning purposes. An average estimate for utilities is $2-$3 per square foot of your gym space per year.

Of course, if you want to satisfy your clients, you may also need to spend some extra money on cable and Internet access.

Variable expenses include cleaning supplies, equipment maintenance, and janitorial services. This covers cleaning supplies, towels, and laundry. All these things are necessary to keep the health department and your members happy—and to create a gym that people will want to return to.

Payroll

Unless you plan to operate your gym alone, there's a good possibility you'll need to hire people to help run different parts of your new business.

When determining how many employees you need, base your numbers on a ratio of one staff person to 50 gym members. For example, if you have a goal of 500 members, you will need 10 employees (including receptionists, sales staff, cleaners, and personal trainers).

Your payroll expenses will vary by location due to minimum wage requirements and expectations for wages across a wide range of staff positions. For example, a personal trainer in New York may expect $35 an hour, while the same position in Florida pays $25.

Other staff members might include an accountant, an office manager, an attorney, and a marketing coordinator, which are usually paid hourly rates that differ by region.

If you hire employees versus general contractors, remember to factor insurance and worker’s compensation costs into your budget.

If there’s any money left over after paying your employees and covering the month’s expenses, then you get paid. You shouldn't expect to make very much—or anything—for the first six months. This is why you must have a financial cushion, as you still need to eat and pay your bills.

Marketing Expenses

Budgeting between $2,500-$5,000 for an initial marketing effort is a good idea when launching a new gym business.

Traditional local marketing methods include billboard advertising, television commercials, and collaboration with local businesses. You should budget ongoing advertising costs at 7.5% of your turnover.

Advertising and other promotional efforts don't need to be elaborate to be successful. Many fitness centers today depend solely on social media platforms for their marketing efforts and rely heavily on word of mouth. Most of your marketing budget will initially go towards giveaways, contests, free memberships, and other activities to increase your membership number.

Insurance

With potentially tens or hundreds of people in and out of your facility each day, you must protect your business from liability if things go wrong.

A new gym requires five main types of insurance, including: Worker’s Compensation: Provides coverage if an employee makes a claim against you for a work-related injury

• Worker’s Compensation: Provides coverage if an employee makes a claim against you for a work-related injury
• General Liability: Protects you if your staff or equipment is deemed responsible for an accident or injury to a person while on your premises
• Professional Liability: Provides coverage if an employee is found to have committed "errors or omissions" which have led to an accident or injury (such as a staff member not re-racking a barbell and a member trips over it, injuring themselves)
• Business Income and Extra Expense Coverage: Provides coverage if you must repair or temporarily relocate if your business is affected by flood, fire, or earthquake
• Equipment Breakdown Coverage: Provides coverage for expenses incurred due to equipment breakdown (for equipment that is out of warranty)

You should allocate $6,000-$12,000 in annual premiums for your insurance.

The lower amount will provide more limited coverage, while the higher may compensate you for other losses, such as potential membership fees due to an accident.

So, How Much Does It Cost to Build a Commercial Gym?

If you're a fitness enthusiast who wants to open your own gym, the idea can be exciting, liberating, and scary. As with any other small business venture, you will need courage, perseverance, and determination—as well as reliable funding to support your efforts.

Running a gym requires lots of time, sweat, energy, and cash. However, for many passionate health and fitness entrepreneurs, the experience of building a positive, healthy space within their communities is priceless.

The unsatisfying answer to "how much does it cost to build a commercial gym" is: it depends. This guide has covered most of the costs that most new gym owners will face when starting their business, but the actual cost will always depend on your unique goals and circumstances.

Since 2006, Again Faster has supplied thousands of fitness affiliates and commercial gyms. We're excited to help you design a new gym or upgrade an old one with the highest quality equipment available. A recent favorite project was outfitting a state of the art gym for a Florida business whose culture includes a commitment to wellness and fitness for its employees.

Check out our commercial gym packages if you're ready to stop planning and start building your dream gym facility.

Need to make changes to an existing package? We can customize any commercial gym package to meet your specific needs. Simply request a personal consultation today.